WEEKEND LIGHTER: A MILLENNIUM TURNS EIGHTEEN!
WEEKEND LIGHTER: A MILLENNIUM TURNS EIGHTEEN!
(December 16-31, 2017)
I-Cover Story
A Millennium turns eighteen
December 31, 2017
Tonight 21st Century will enter its eighteenth year of existence. 18 years may not be a long period, but the 18th Birthday calls for celebration as this is the time one is close to becoming a major when one looks back with satisfaction and looks forward with confidence to live life on one’s own terms. The legacy of the previous millennium becomes history and the 21st Century is now going to decide the path it is going to take to perform better than the previous century and what way it is going to make 22nd Century proud of its predecessor.
Let’s wish all those who will support 21st Century move in the right direction from tomorrow a HAPPY NEW YEAR!
II RECENT RESPONSES
RBI’s reserves
This refers to A K Bhattacharya’s piece on ‘North Block versus Mint Road’ (Business Standard, Raisina Hill, December 25). This response is independent of the assumed ‘friction’ between GOI (as owner of RBI) and RBI (as a statutory body with mandated responsibilities) and tries to look at the need to strengthen RBI’s balance sheet.
Contingency Fund maintained by RBI represents the amount set aside on a year-to-year basis for meeting unexpected and unforeseen contingencies, including depreciation in the value of securities, risks arising out of monetary/exchange rate policy operations, systemic risks and any risk arising on account of the special responsibilities enjoined upon the Bank. The balance in Contingency Fund decreased from Rs2,216.14 billion as on June 30, 2015 to Rs2,201.83 billion as on June 30, 2016 due to MTM loss of Rs14.30 billion on valuation of forward contracts, which was charged to the Contingency Fund as on June 30, 2016 but reversed on the first working day of the following year.
The Asset Development Fund created by RBI in 1997-98, represents the amounts set aside each year to meet internal capital expenditure and make investments in subsidiaries and associate institutions. The balance in ADF increased from Rs217.61 billion in 2014-15 to Rs227.61 billion as provision of Rs10 billion made for additional capital contribution in BRBNMPL was transferred to ADF as on June 30, 2016.
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Balances in Contingency Fund and Asset Development Fund*
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(Rs billion)
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As on June 30
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Balance in CF
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Balance in ADF
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Total
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CF and ADF as per centage to total assets
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1
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2
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3
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4=(2+3)
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5
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2012
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1954.05
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182.14
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2136.19
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9.7
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2013
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2216.52
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207.61
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2424.13
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10.1
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2014
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2216.52
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207.61
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2424.13
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9.2
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2015
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2216.14
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217.61
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2433.75
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8.4
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2016
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2201.83
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227.61
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2429.44
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7.5
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*Source: RBI Annual Reports
In the absence of a conscious decision based on a scientific study to bring down the level of reserves as a percentage of assets, it would be prudent for GOI to allow the central bank to transfer a portion of the surplus income to its reserves, at least until the level reaches the earlier accepted target of 12 per cent of total assets. Or, GOI should, after amending the RBI Act contribute more to the share capital which has not seen any upward revision from the original Rs 5 crores at the inception.
Viewed in the above context, the alleged pressure on RBI to reopen the appropriations of income made by RBI in its 2016-17 balance sheet looks intriguing. It is in the interest of GOI to have a central bank with a strong balance sheet.
M G Warrier, Thiruvananthapuram
Cleansing the election process
This refers to the story “The next political challenge” (Business Standard, Politics & public affairs, December 18) analyzing the status and prospects of fortunes of a cross-section of political combinations in Karnataka, Meghalaya, Nagaland and Tripura. The 2018 Assembly elections should be taken as an opportunity to change the perceptions about the electoral processes in the minds of people.
There was a visible change in the conduct of political parties across denominations in the 2014 elections. The reference is to the focus on issues at that time, thanks to the influence of India Against Corruption (IAC) movement and the urge for change generated by a static governance machinery at the Centre. Three years down the line, the experience of the just concluded Gujarat and Himachal Pradesh elections makes one feel that politics in India has not absorbed the lessons of 2014. The same old blame games, caste and creed issues, anxiety to retain power at any cost and absence of issue-based campaign marked the 2017 Assembly elections.
As democratic institutions in India mature, we need to show to the world that we are capable of informed debates on issues both in legislatures and on streets (during elections). An impression is gaining that money power is getting precedence over talent, selection of candidates for constituencies is being guided by chances of X to win attracting votes from a particular class of voters who have a dominating presence in the constituency. Political parties should sit together and discuss how such apprehensions can be allayed. There is also need to bring down cost incurred by candidates fighting elections. Here, unless all political parties cooperate, thresholds and guidelines from Election Commission will continue to get violated in spirit.
2018 Assembly elections should be seen as an opportunity to bring about changes.
M G Warrier, Thiruvananthapuram
III Leisure
Nothing gets in his way
On December 28, 2017, we spent the day at Magic Planet, a Theme Park of international standard conceived and brought into reality by renowned magician Gopinath Muthukad from God's Own Country (Kerala).
We, seven of us, had booked entry tickets online (Rs450 per person) and reached there before 10 a m(The timing 10 a m to 5 p m). We were introduced to Magic Planet by a person who was born without both hands and both legs (now 24 years) who joined Magic Planet when he was doing research for Ph D after post-graduation.
Please read the Deccan Chronicle article about Shihabudeen using the following link:
Several 'differently abled' persons are performing excellent magic items here. Also, some traditional Indian magic items like producing instantly a fruit-bearing mango tree from a mango seed were performed by magicians from villages in Kerala.
Overall, a full day entertainment
M G Warrier
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